Temasek's Returns Disappointing!!!

dragg SG

extracted from ST forum.

SINGAPORE'S Temasek Holdings has been very much in the news in recent weeks with the high-profile multi-billion-dollar purchase of Shin Corp and its offer for P&O.

While many of Temasek's deals are long term in nature, it is nonetheless disheartening to learn that for the last five years, its total shareholder return was a paltry one per cent a year, against 2.7 per cent for the Straits Times Index.

As a stakeholder in the country's hard-earned reserves, I find this most disappointing as its performance is way below that of many public companies here.

Surely, the rate of shareholder return must form part of the key performance indicators for Temasek's senior executives. The return on investment must at least match those achieved by the average public company.

Jeffrey Ho Loon Poh

shade343 SG

The general elections are coming. Use it to voice your displeasure.

charlize SG

Hey, but didn't you say in another thread that the money that is managed by Temasek belongs to the government and NOT Singaporeans.

Why should you be worried about Temasek's pathetic returns then? Laughing

sbst275 SG

See what is going on at Thailand now

charlize SG

Everytime Temasek makes an overseas investment, you will find some analysts questioning why they are over paying for that investment.

At the rate they seem to just buy and buy without consideration for costs, it is no wonder the returns are not up to expectations. Laughing

shade343 SG

Since when was I worried? Laughing

Temasek's money is not my money. Temasek Holdings substantial shareholder is the Ministry of Finance.

And the guy who writes the letter needs to reflect also. Can he confidently say his portfolio has consistently outperform the benchmark STI?

If the writer feels that he can do a better job, why not he send his resume to TH?

shade343 SG

They have appointed independent financial advisors to advise them. Laughing

Atobe SG

Can Temasek ever have any positive returns when almost every investment seems to be at prices that are excessive and beyond market price ?

From an Economist.com report dated 26 January 2006, it was stated that -

"Temasek is paying a fairly expensive 15 times prospective 2006 earnings for Shin Corp" .

In a Bloomberg.com report dated 25 January 2006, it was stated that -

"Shin Corp., established and controlled by the Thaksin family, owns Shin Satellite Pcl, Asia's third-biggest operator of commercial orbiters. Other assets include television station ITV Pcl, Internet service provider C.S. Loxinfo Pcl and budget airline Thai AirAsia Co.

Shin Corp.'s annual profit in 2004 fell for the first time since 2000. The company's net income in the third quarter of 2005 dropped 10 percent to 1.98 billion baht. Competition eroded the market share of Advanced Info, Shin Corp.'s primary asset, to 56 percent as of November from 58 percent a year earlier. "

Despite having a wide portfolio of different businesses, Shin Corp' annual profit continue to drop over two consecutive financial years in a market that is becoming competitive and eroding market share.

Has Temasek taken a big bite more then it can swallow ?

Shin Corp is owned as a PRIVATE ENTERPRISE before Thaksin was elected as the Thai PM, its success and size has been build by PRIVATE CAPITAL and ENTREPRENEURSHIP.

Temasek Holdings is owned by the Singapore Government and is a PUBLIC ENTERPRISE - disguised as a PRIVATE ENTITY - funded entirely from NATIONAL Annual Budget Surplus transferred from the Ministry of Finance. The Board of Directors of Temasek are all Political Appointees and its Management having a Civil Servant mentality.

In this exchange of funds to takeover Shin Corp, it will seem that the Private Enterprise will seem to have been "more shrewd" in the management of the successful outcome then any profitable long term benefit for the Public Enterprise.

Calvin86 SG

Yes the writer can be certain he can out perform temasek. The writer can produce a return equivalent to STI index by passive indexing of fund where the fund manager tries to mirror the index performance.

charlize SG

1% per annum?

Even FDs, bonds, T notes can outperform this. Laughing

charlize SG

And still they get 1% return per annum?

What kind of independent financial advisors are they appointing? Laughing

SilverPal SG

Scholars.

shade343 SG

For the P&O deal, they have appointed 3 advisors I think--DBS, Goldman Sachs and JP Morgan. Laughing These are established Financial companies.

Li Ka Shing SG

Dont worry…... 1% right…....dont worry…..maybe it’s to pay for these expansions…..

AF2005 SG

any 5% GST for temasek deals? I am not sure how GST comes to play, but i believe they must be prepared to deal with the taxman for all 5%GST due.

shade343 SG

GST stands for GOODS AND SERVICES TAX. Means taxes for consumables.

Gedanken SG

Can’t say I’ve known too many family businesses that pay any attention to their shareholders.

Salman SG

We don't believe in get rich quick schemes.
What we have seen is long term stable growth.
It is also difficult to compare Temasek and commercial fund managers because both are very different in scope, protocol and activity.

shade343 SG

Lets see. What is 1% of 100 billion dollars in assets? Get the picture here?

AF2005 SG

actually even 1% of highest $150billion is $1.5billion. Sharing the $1.5billion is damn a lot for multi-million individuals, and this can generate 1 500 millionaires.